Comparing ATS (NYSE:ATS) and Flowserve (NYSE:FLS)

ATS (NYSE:ATS) and Flowserve (NYSE:FLS) are both industrials companies, but which is the better stock? We will compare the two companies based on the strength of their analyst recommendations, institutional ownership, valuation, profitability, dividends, risk and earnings.

Volatility and Risk

ATS has a beta of 1.2, suggesting that its stock price is 20% more volatile than the S&P 500. Comparatively, Flowserve has a beta of 1.23, suggesting that its stock price is 23% more volatile than the S&P 500.

Insider and Institutional Ownership

75.8% of ATS shares are held by institutional investors. Comparatively, 93.9% of Flowserve shares are held by institutional investors. 0.7% of Flowserve shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Valuation & Earnings

This table compares ATS and Flowserve”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
ATS	$2.97 billion	0.93	$51.85 million	$0.52	54.45
Flowserve	$4.65 billion	2.17	$346.25 million	$2.70	29.26

Flowserve has higher revenue and earnings than ATS. Flowserve is trading at a lower price-to-earnings ratio than ATS, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares ATS and Flowserve’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
ATS	2.40%	9.40%	3.73%
Flowserve	7.61%	21.46%	8.54%

Analyst Ratings

This is a breakdown of current ratings and target prices for ATS and Flowserve, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
ATS	2	1	4	0	2.29
Flowserve	0	3	8	0	2.73

ATS currently has a consensus price target of $42.50, suggesting a potential upside of 50.11%. Flowserve has a consensus price target of $87.70, suggesting a potential upside of 11.01%. Given ATS’s higher probable upside, research analysts plainly believe ATS is more favorable than Flowserve.

Summary

Flowserve beats ATS on 12 of the 14 factors compared between the two stocks.

About ATS

ATS Corporation, together with its subsidiaries, provides automation solutions worldwide. The company is also involved in planning, designing, building, commissioning, and servicing automated manufacturing and assembly systems, including automation products and test solutions. In addition, it offers pre-automation services comprising discovery and analysis, concept development, simulation, and total cost of ownership modelling; post automation services, including training, process optimization, preventative maintenance, emergency and on-call support, spare parts, retooling, retrofits, and equipment relocation; and contract manufacturing services, as well as after sales and services. Further, the company provides engineering design, prototyping, process verification, specification writing, software and manufacturing process controls development, standard automation products/platforms, equipment design and build, third-party equipment qualification, procurement and integration, automation system installation, product line commissioning, validation, and documentation services. Additionally, it offers value engineering, supply chain management, and integration and manufacturing capabilities, as well as other automation products and solutions; and software and digital solutions comprising connected factory floor management systems to capture, analyze, and use real time machine performance data to troubleshoot, deliver process and product solutions, prevent equipment downtime, drive operational efficiency, and unlock performance for sustainable production improvements. ATS Corporation serves life sciences, transportation and mobility, consumer products, food and beverage, electronics, nuclear, packaging, warehousing and distribution, and energy markets. The company was formerly known as ATS Automation Tooling Systems Inc. and changed its name to ATS Corporation in November 2022. ATS Corporation was founded in 1978 and is headquartered in Cambridge, Canada.

About Flowserve

Flowserve Corporation designs, manufactures, distributes, and services industrial flow management equipment in the United States, Canada, Mexico, Europe, the Middle East, Africa, and the Asia Pacific. It operates through Flowserve Pump Division (FPD) and Flow Control Division (FCD) segments. The FPD segment offers custom and pre-configured pumps and pump systems, mechanical seals, auxiliary systems, replacement parts, upgrades, and related aftermarket services; and equipment services, including installation and commissioning services, seal systems spare parts, repairs, advanced diagnostics, re-rate and upgrade solutions, retrofit programs, and machining and asset management solutions, as well as manufactures a gas-lubricated mechanical seal for use in high-speed compressors for gas pipelines and in the oil and gas production and process markets. The FCD segment provides engineered and industrial valve and automation systems, including isolation and control valves, actuation, controls, and related equipment; and equipment maintenance services for flow control systems, including advanced diagnostics, repair, installation, commissioning, retrofit programs, and field machining capabilities. This segment's products are used to control, direct, and manage the flow of liquids, gases, and multi-phase fluids. It primarily serves oil and gas, chemical and pharmaceuticals, power generation, and water management markets, as well as general industries, including mining and ore processing, pulp and paper, food and beverage, and other smaller applications. The company distributes its products through direct sales, distributors, and sales representatives. Flowserve Corporation was founded in 1790 and is headquartered in Irving, Texas.